MQ BI 2008

Magic Quadrant for Business Intelligence Platforms

16 January 2009

James Richardson, Kurt Schlegel, Rita L. Sallam, Bill Hostmann

Gartner RAS Core Research Note G00163529

Early
in 2008, the megavendors took ownership of a majority share of the
business intelligence platforms market via acquisition. The
repercussions of that consolidation are still working through the
market, with a growing split in buying behavior becoming evident.

What You Need to Know

This document was revised on 5 February 2009. For more information, see the Corrections page on gartner.com.

The Magic Quadrant for Business
Intelligence Platforms (see Figure 1) presents a global view of
Gartner's opinion of the main software vendors that should be
considered by organizations seeking to develop business intelligence
(BI) applications. Buyers should evaluate vendors in all four quadrants
and not assume that only the largest organizations can deliver
successful BI implementations. In addition to Gartner analysts'
opinions, the scores and commentary in this document are based on three
sources: customer perceptions of each vendor's strengths and challenges
derived from BI-related inquiries with Gartner, an online survey of
vendor customers conducted in late 2008 yielding 480 responses, and a
vendor-completed questionnaire about their BI strategy and operations.

Figure 1.Magic Quadrant for Business Intelligence Platforms, 2009

In January 2008, SAP completed its
acquisition of Business Objects and IBM completed its acquisition of
Cognos. The acquired firms were two of the largest in the market and
had, arguably, been the defining suppliers in the space. Their
absorption into larger entities (along with Hyperion into Oracle six
months earlier) seemingly marked the end of BI platforms as a
predominantly stand-alone, best-of-breed, buying decision. In 2008, BI
platform investment decisions became tethered more closely to strategic
sourcing and stack-led factors, and more influenced by organizational
relationships with application and infrastructure vendors than before.
Conversely, however, based on the research conducted for this report
and interactions with Gartner customers over the year, there clearly
remains a demand for independent BI platforms. To understand this
duality, it is necessary to consider a number of factors at play that
are driving the BI platform today:

A growing bifurcation of buying preference. There are two types of
buying behavior evident: A) firms that see their BI platform as an
extension of their enterprise middleware, and require the platform to
fit into more heterogeneous data and application sources; and B) those
with an inclination for pre-integration of a BI platform into a stack
of data and application sources from a single vendor.

Innovation yielding to integration. One consequence of the market's
consolidation has been that the acquiring megavendors' product releases
and road maps have inevitably been dominated by integrating the
acquired technologies into their existing portfolios. These vendors
face a challenge balancing the conflicting goals of making the BI
platform better at working together with the vendor's other products,
while at the same time not becoming too inward facing. In the main,
innovation in BI platforms is being driven by independents.

"Flattening" alternatives. The maturing of Microsoft's lower-cost
BI portfolio, the application of Web 2.0 techniques, the availability
of data warehouse (DW) appliances, the growth of open-source BI and the
ongoing emergence of software as a service (SaaS) offerings have
continued to make BI capabilities increasingly accessible and more
affordable. As a result, this Magic Quadrant includes commentary on
some alternative vendors which, while not meeting the inclusion
criteria for the Magic Quadrant itself, offer a viable alternative for
some BI use cases.

The re-emergence of "workgroup BI." Many of the pioneering vendors
of the BI space entered the market delivering personal and
workgroup-based BI. After much encouragement from their clients and
from analyst firms (including Gartner), these vendors began to focus
most of their resources on delivering enterprisewide BI solutions. This
left an opening for a new crop of vendors to deliver solutions for
personal and workgroup BI requirements using disruptive technology
(specifically in-memory analytics). It seems likely that despite the
inherent risk of silo-perpetuation, workgroup BI's light-touch nature
will prove attractive in a recession.

Return on investment equivalence. Based on conversations with
Gartner customers, and the survey carried out for this research, beyond
the capability to meet the needs of international deployments, there is
no correlation between the size of a vendor (in either revenue or staff
terms) and the level of satisfaction or the return on investment
delivered with a BI platform implemented. Formerly, while the market
was dominated by independent pure-play BI firms, size was an important
indicator as to capability; now, this isn't the case — a $300 million
revenue BI specialist may well (and often does) out-deliver a more
broad-based vendor many times its size. This apparent equivalence in
the relative level of success delivered is reflected in the Ability to
Execute axis positions in this year's Magic Quadrant.

After the vendor merger and acquisition
(M&A) turbulence of 2007, 2008 was a year of transition. And 2009
is likely to be a critical year in which the total cost of ownership
(TCO) of BI comes under increased scrutiny, and its value as a
decision-making tool in the toughest economic conditions is put to the
test.

Forecast

Gartner's view is that BI platform revenue
will be less affected by the economic downturn than some other
technologies because of the heightened need to make better, fact-based
decisions — BI is a vital competitive tool of increased importance in
an environment where doing business more smartly, in order to maximize
share of the reduced revenue in circulation, is a necessity. That said,
however, the recession, commoditization and consolidation are expected
to put BI platform growth into the single digits in 2009 and beyond. As
such, the BI platform market's compound annual growth rate (CAGR)
through 2012 is expected to be 7.0% for stand-alone BI platforms and
7.9% for both stand-alone and embedded functionality (for details and
an explanation of terms see "Forecast: Enterprise Software Markets,
Worldwide, 2007-2012, 4Q08 Update").

Several demand-side factors indicate that BI platform revenue will continue to grow:

CIOs are increasingly being required to invest in technologies that
drive business transformation and strategic change. The fact that BI is
a top priority for CIOs indicates that they see BI as part of the
answer to this requirement. BI can deliver on this promise if deployed
successfully because it could improve decision making and operational
efficiency, which in turn drives the top line and the bottom line.

Information generated from enterprise applications is at an
all-time high and will continue to increase. BI platforms are seen as a
means to turn that information into an asset on which better decisions
can be made.

Smaller and midsize organizations are becoming an important target
market for BI vendors, with a large proportion being new opportunities.
The success of smaller vendors targeting the segment, new SaaS delivery
models and increased offerings from Microsoft are prompting further
growth in demand. In addition, several vendors traditionally not in
this domain have been modifying or extending their product, pricing and
partner strategies to reach this key group.

While BI standardization projects are increasing, departmental
projects are also on the rise, especially those provided by smaller
horizontal analytics specialists and within emerging technologies, such
as in-memory BI, search and visualization.

Areas that have traditionally been under corporate performance
management (CPM), such as business planning and forecasting, are
increasingly being embedded with BI capabilities. This, together with a
trend of embedding analytics into business processes, will drive
further investment in BI.

Consumerization of information — Users are becoming increasingly
savvy in using and manipulating information to their advantage. This
will enable a spread of BI across organizations, leading to a need for
more licenses. Technology trends, such as increasing visualization,
might help further.

Another positive driver is the use of BI functions in
customer-facing Web site applications as a value-adding service
differentiator, using Rich Internet Application (RIA) techniques.

BI platforms are used to build
applications that help organizations learn and understand their
business. Gartner defines a BI platform as a software platform that
delivers the 12 capabilities listed below. These capabilities are
organized into three categories of functionality: integration,
information delivery and analysis. Information delivery is the core
focus of most BI projects today, but we see an increasing need to focus
more on analysis to discover new insights, and on integration to
implement those insights.

Integration

BI infrastructure — All tools in
the platform should use the same security, metadata, administration,
portal integration, object model and query engine, and should share the
same look and feel.

Metadata management — This is
arguably the most important of the 12 capabilities. Not only should all
tools leverage the same metadata, but the offering should provide a
robust way to search, capture, store, reuse and publish metadata
objects such as dimensions, hierarchies, measures, performance metrics
and report layout objects.

Development — The BI platform
should provide a set of programmatic development tools — coupled with a
software developer's kit for creating BI applications — that can be
integrated into a business process, and/or embedded in another
application. The BI platform should also enable developers to build BI
applications without coding by using wizard-like components for a
graphical assembly process. The development environment should also
support Web services in performing common tasks such as scheduling,
delivering, administering and managing.

Workflow and collaboration — This
capability enables BI users to share and discuss information via public
folders and discussion threads. In addition, the BI application can
assign and track events or tasks allotted to specific users, based on
predefined business rules. Often, this capability is delivered by
integrating with a separate portal or workflow tool.

Dashboards — This subset of
reporting includes the ability to publish graphically intuitive
displays of information, including dials, gauges and traffic lights.
These displays indicate the state of the performance metric, compared
with a goal or target value. Increasingly, dashboards are used to
disseminate real-time data from operational applications.

Ad hoc query — This capability,
also known as self-service reporting, enables users to ask their own
questions of the data, without relying on IT to create a report. In
particular, the tools must have a robust semantic layer to allow users
to navigate available data sources. In addition, these tools should
offer query governance and auditing capabilities to ensure that queries
perform well.

Microsoft Office integration — In
some cases, BI platforms are used as a middle tier to manage, secure
and execute BI tasks, but Microsoft Office (particularly Excel) acts as
the BI client. In these cases, it is vital that the BI vendor provides
integration with Microsoft Office, including support for document
formats, formulas, data "refresh" and pivot tables. Advanced
integration includes cell locking and write-back.

Analysis

OLAP — This enables end users to
analyze data with extremely fast query and calculation performance,
enabling a style of analysis known as "slicing and dicing." This
capability could span a variety of storage architectures such as
relational, multidimensional and in-memory.

Advanced visualization — This
provides the ability to display numerous aspects of the data more
efficiently by using interactive pictures and charts, instead of rows
and columns. Over time, advanced visualization will go beyond just
slicing and dicing data to include more process-driven BI projects,
allowing all stakeholders to better understand the workflow through a
visual representation.

Scorecards — These take the metrics
displayed in a dashboard a step further by applying them to a strategy
map that aligns key performance indicators to a strategic objective.
Scorecard metrics should be linked to related reports and information
in order to do further analysis. A scorecard implies the use of a
performance management methodology such as Six Sigma or a balanced
scorecard framework.

Vendors were included in the Magic Quadrant if they met the following requirements:

Generate $20 million or more total software revenue* from BI
platform software sales annually or, in the case of open-source BI
platform software, generate $20 million total company revenue annually.

Have customers that have deployed the vendor's BI platform as their
enterprise BI solution and, in the case of vendors that also supply
transactional applications, the BI platform is routinely used by
organizations that do not use its transactional applications.

Deliver at least eight out of 12 capabilities in the BI platform market definition.

*Gartner defines total software revenue as
revenue generated from new licenses, updates, subscriptions and
hosting, technical support, and maintenance. Professional services
revenue and hardware revenue are not included in total software
revenue. See "Market Share: Business Intelligence Platform Software,
Worldwide, 2007."

No new vendors were added to the Magic
Quadrant this year. However, it should be noted that IBM acquired
Cognos, and thus replaces it on the Magic Quadrant.

Even though they do not meet the criteria
for inclusion, there are some alternative vendors that are benefiting
from the growth of the BI platforms market that may be worthy of
consideration in BI evaluations.

There are a number of BI offerings from well established vendors that fall just outside the inclusion criteria. One example is Targit,
a Danish headquartered firm that focuses on BI usability with its suite
of reporting, dashboarding and ad hoc analysis tools, front-ending
Microsoft, Oracle or IBM databases, usually for midsize customers.
Targit's 3,000 customers, 288 certified resellers in 42 countries, and
OEM channels including Microsoft and Ross Systems make it a strong
contender for inclusion in next year's Magic Quadrant.

Other large enterprise application vendors
also have BI platform offerings, but we opted not to include them as
they are more of an augmentation to their existing ERP applications as
opposed to independent enterprise BI platforms:

Infor, a large global software vendor with more than 70,000
customers has its own BI platform offering, which comprises the Infor
PM OLAP database, Infor PM Application Studio for end-user reporting
and the Infor PM Office Excel client. It intends to add a new product,
Infor Reporting, in 2009.

Lawson is a global software vendor targeting the healthcare,
public sector, fashion, food and manufacturing industries. Lawson
offers a BI platform that integrates into its business applications.
The company provides out-of-the box, industry-specific content. It is
expanding its BI product offerings to include pre-configured analytics,
reporting tools and business process improvements driven by the needs
of its targeted industries.

Other vendors with a traditional licensed software approach to BI include Bitam and LogiXML.

This year Gartner gave serious
consideration to including open-source BI suppliers in the Magic
Quadrant, and even altered the inclusion criteria to allow for this
eventuality. As yet, though, no open-source BI platform supplier
generates enough revenue to be included in the Magic Quadrant. However,
while they don't meet the revenue requirement, Jaspersoft and Pentaho
have emerged as viable players in the BI platform market and as such we
invited these firms to take part in the Magic Quadrant user survey.
Both open source vendors provide comprehensive BI platform capabilities
that are comparable to traditional BI platform vendors. A key part of
both vendors' strategy is to forge OEM relationships with commercial
independent software vendors (ISVs) looking to easily embed BI
functionality at a low price point. Jaspersoft and Pentaho enable ISVs
to OEM open-source BI components without being bound by the GNU General
Public License (GPL) terms and conditions. Given their
subscription-based model, both vendors need to provide exemplary
support. This was in evidence in the MQ reference survey, as both
Jaspersoft and particularly Pentaho scored strongly on the customer
support question — higher than any of the megavendors.

Jaspersoft's v3, released in mid-2008,significantly
improved its offering in three major areas. First, it provided an
extended metadata capability for full business-level abstraction of the
underlying data models. Second, based on this extended metadata layer,
it extended its ad hoc capability to create queries, reports and
dashboards. Third, it improved its ad hoc query interface with an Ajax
client and support for Flash/Flex. Much of Jaspersoft's early adoption
has been through reseller and OEM agreements with Red Hat, MySQL,
Ingres and Unisys. Despite this momentum, Jaspersoft did score lowest
of all vendors on one MQ Customer Reference survey question, which
asked about the ability to support a large number of users.

Pentaho, after just four years in
existence, has put together a comprehensive open-source BI platform
that includes data integration and data mining capabilities. In 2008,
Pentaho was noticeably more aggressive, openly competing against
traditional BI platform vendors. Like Jaspersoft, Pentaho is affordable
and also offers a subscription-based model that avoids an initial large
payment for the software license. Some of the significant features
Pentaho introduced in 2008 include an automatic table designer that
analyzes relational schemas and data patterns, performs a cost-benefit
analysis of aggregation at different levels, and generates and
populates those aggregate tables. Despite a handful of large customers,
Pentaho reference survey respondents more frequently indicated that
they had more departmental deployments (versus enterprisewide) and
smaller data volumes compared with the other vendors.

Other providers are addressing BI from different angles. IDS Scheer,
which has dominated the business process analysis market with its ARIS
platform, is another emerging vendor in the BI platform market. Most of
its traction in the BI platform space to date has been from combining
metrics with processes and adding performance management and
performance dashboard functionality to a company's process view. This
builds on IDS Scheer's capability to generate and visualize the
structure of existing processes, and positions IDS Scheer in the
process-driven analytic application segment of the BI platform market.
This market segment is smaller and more for advanced functionality, but
as the customer base matures and begins to demand more closed-loop
functionality, the need for root-cause analysis and what-if scenario
modeling will drive adoption of IDS Scheer's platform.

There is also increasing interest in SaaS
solutions in the BI platforms market. SAP Business Objects is perhaps
the largest in this submarket with its OnDemand offerings, but there
are smaller vendors, like PivotLink, Oco and LucidEra,
delivering BI as a service. Moving BI off-premises may not suit all
organizations, especially those dealing with highly sensitive data, but
firms that find the SaaS value proposition of more rapid, lower-cost
deployments attractive should evaluate these options.

Leaders are vendors that are reasonably
strong in the breadth and depth of their BI platform capabilities, and
which can deliver on enterprisewide implementations that support a
broad BI strategy. Leaders articulate a business proposition that
resonates with buyers, supported by the viability and operational
capability to deliver on a global basis.

Challengers offer a good breadth of BI
platform functionality and are well positioned to succeed in the
market. However, they may be limited to specific technical environments
or application domains. Their vision may be hampered by a lack of
coordinated strategy across the various products in their BI platform
portfolio. Or they may lack the sales channel, geographic presence and
industry-specific content offered by the vendors in the Leaders
quadrant.

Visionaries are vendors that have a strong
vision for delivering a BI platform. They are distinguished by the
openness and flexibility of their application architectures, and they
offer depth of functionality in the areas they address, but they may
have gaps relating to broader functionality requirements. A visionary
vendor is a market thought-leader and innovator. However, it may have
yet to achieve sufficient scale — or there may be concerns about its
ability to grow and provide consistent execution.

Niche Players are those that do well in a
specific segment of the BI platform market — such as reporting — or
that have limited capability to innovate or outperform other vendors in
the market. They may focus on a specific domain or aspect of BI, but
are likely to lack depth of functionality elsewhere. Or they may have
gaps relating to broader BI platform functionality. Alternatively,
Niche Players may have a reasonably broad BI platform, but have limited
implementation and support capabilities or relatively limited customer
bases. Or they may have not yet achieved the necessary scale to
solidify their market positions.

Strong federated query capabilities across enterprise resource
planning (ERP), relational database management system (RDBMS), OLAP,
corporate performance management (CPM) and other BI systems make
arcplan attractive in heterogeneous environments or as a means of
integrating other BI investments. The newly added support for
third-party content via mashup communications into arcplan-published
applications extends its capabilities in visualization/charting and
content integration. (A "mashup" being a lightweight tactical
integration of multi-sourced applications or content into a single
offering as composite applications.)

arcplan is one of the most widely deployed and successful front-ends for SAP BW.

Its portal integration, process orientation and federated
write-back capabilities support the building of complex analytic
applications that are beyond the scope of many BI vendors; for example,
to deliver closed-loop planning or to support collaborative, unified
operational and financial performance management.

Until now, arcplan has successfully adopted a position as a
value-adding partner to larger BI vendors, which has enabled it to
coexist, and avoid competing, with them. In last year's MQ, Gartner
encouraged arcplan to clarify its marketing, in order to clearly
differentiate the core capabilities of its BI platform in developing
custom or packaged analytic applications, and its stronger focus on
enterprise performance management will help it achieve that.

Its Microsoft Office integration was late to market (being launched
in December 2007) and the arcplan customers that Gartner contacted for
this research reported this as its main functional weakness, as they
did a year earlier. It should be noted that few of the arcplan
customers responded that they use this functionality extensively. This
fact, coupled with less than 50% usage of the latest version, may
explain why Office integration is still seen as an issue.

The performance of arcplan-delivered applications is highly
dependent on the performance of the underlying data stores and
applications. Evaluators should factor the performance of source
systems into their thinking when considering arcplan.

arcplan has exploited a niche in the BI platform market by serving
a subset of specific, complex BI needs for its customers. However, this
niche will be increasingly squeezed by the larger BI platform vendors'
expansion of their capabilities to address the gaps that arcplan fills
(for more on this see "Unlocking the Value of SAP BW by Layering a
Third-Party BI Platform"). For instance, one of arcplan's core markets
has been the Hyperion user base, where Oracle's own federated query
capabilities are a potential threat. Similarly, SAP will now drive
NetWeaver BI/BW users toward its Business Objects' derived portfolio.

Currently, arcplan has a limited channel to market. It must build
its indirect channel in order to grow and maintain its market share.

Actuate's core product, e.Reports, is a well-established, scalable
platform for delivering high fidelity reports to large numbers of
report consumers, particularly in very large extranet applications that
serve the financial and public sectors.

Actuate is shifting its go-to-market emphasis to its BIRT-based
open-source platform and products — each providing a programming
environment. This Java-based platform for building, RIA and mashups is
expanding Actuate's market opportunity beyond its traditional niche to
meet the authoring and interactivity needs of business users in smaller
organizations across a broad range of industries.

Actuate's investments in its open-source products and sales and
marketing activities are beginning to pay off. Although Actuate's
overall revenue growth is flat, BIRT sales account for 20% of its
revenue, and the company expects this to double in 2009, due to
traction in the developer community and with new OEM relationships.

Actuate's e.Spreadsheet reporting technology continues to address
spreadsheet distribution issues, although its once differentiated
position is being challenged by new managed spreadsheet offerings,
particularly Microsoft SharePoint Server Excel Services. In 2008,
Actuate released its e.Spreadsheet Designer tool as freeware from its
BIRT-exchange community site.

Actuate customers contacted for this research rate Actuate above average in reporting and in the top three for product quality.

Increasingly, customers use Actuate to fill niche BI requirements.
While one-third of Actuate customers surveyed for the 2008 MQ
considered it their enterprise BI standard, this time only one-fifth
did so — an equal number reported that a competing vendor's BI platform
is considered the BI standard.

Actuate's programming language for e.Reports, while powerful, is
complex. Actuate customers surveyed for the MQ rated its development
tools the lowest of any vendor and reported that the software can be
difficult to use. The BIRT platform's collaborative reporting process,
which provides common tools across its three types of users (technical,
business and power) is a step forward in usability for Actuate, as is
its support for more standard languages like Java and JavaScript.

Actuate provides limited support for OLAP and ad hoc analysis and
was ranked in the bottom three in the combined BI platform rating due
to its primary focus on reporting. Given that Actuate is making limited
investments in enhancing its OLAP capabilities, its niche focus will
exclude it from shortlists as more enterprises look to standardize on
vendors that can provide end-to-end BI platform capabilities.

Actuate's BIRT products constitute a growing percentage of the
company's overall revenue with a positive diversification effect.
However, successes derived from Actuate's BIRT strategy may not
compensate for negative growth pressures from a contraction in the
overall economy (and financial services in particular, where Actuate
derives roughly half its revenue) and increased competition in a
consolidated BI market.

Board International is a long established company with a well
integrated BI platform focused on developing and deploying custom
analytic applications (on the same foundation as its CPM applications),
mainly for midmarket size organizations.

Board's distinctive "toolkit" approach to BI application
development handles database creation and update, data presentation and
analysis, and process modeling in a single graphical environment
without programming. The customers Gartner contacted rated its
development tools highly, behind only MicroStrategy and Microsoft.

Overall feedback from Board's customers is very good, rating it
better than average for all but one of the 11 functional capability
areas its customers use it in, an impressive performance for the
smallest vendor (in revenue terms) included in the Magic Quadrant. Its
lowest-rated area was its "Microsoft Office Integration." As part of a
user interface (UI) overhaul, the firm intends that Board 7 will help
in this area, adopting the "ribbon bar" Office paradigm as its basis,
along with improved visualization functionality.

For its size, Board has developed a credible partner OEM business
via which it serves vertical industry needs (particularly in
pharmaceuticals and foods).

Board is geographically constrained, little known outside its core
markets in Europe, with an embryonic presence in Australia and India
established in 2008. Finding service providers with experience of
implementing Board outside Switzerland, Germany and Italy is a
challenge.

Board technology is Windows only, using Windows Communication
Foundation as the basis of its architecture and Windows Presentation
Foundation for its interface. Like other Microsoft-centric BI firms, it
will experience increasing competition from Microsoft, which may
constrain its growth. However, it should be noted that Board has its
own OLAP technology (with a new relational OLAP [ROLAP] option) and can
now make use of SAP BW and Microsoft SQL Server Analysis Services via
OLE DB for OLAP (ODBO), which may help insulate Board somewhat from the
impact of Microsoft Performance Point Server by broadening its market.

Board's indirect channel-led sales model needs to be supplemented
with a strengthened direct-to-market approach if it is going to grow
beyond its niche. The company has relied purely on its channel for
sales, which has limited its ability to sell in the increasingly
competitive BI platforms market.

While Board is well regarded by its customers, it should be borne
in mind that those responding to Gartner represented smaller companies
(with fewer than 1,000 staff) working with 50 to 99 users and less than
50GB of data on average — the lowest of any vendor surveyed.

BI platform architecture. IBM Cognos 8's Web services-based SOA is
much better integrated than some competing offerings, with shared
metadata across the platform enabling ease of transfer from report to
query to analysis.

IBM's commitment to BI is evident in significant staff expansion,
aiding its ability to execute — globally, the firm has hired over 800
employees since 1 February 2008, representing a 20% growth in the
overall "Cognos" workforce since the acquisition closed. It has also
been assisted by much greater focus from the IBM GBS consulting arm,
which now recommends IBM Cognos in more circumstances.

IBM Cognos has a high proportion of enterprise-standard BI platform
deployments — more than three-quarters of the customers Gartner
contacted as part of this research consider IBM Cognos a BI standard in
their organization.

The IBM Cognos customers that Gartner contacted as part of this
research rated its BI platform functionality very highly, above the
mean in all 11 areas in which it was rated (the omission being
"predictive modeling and data mining" where its offering is
negligible). When all functional ratings are aggregated, IBM Cognos 8
is the single highest scoring BI platform in the survey sample.
Particular areas of strength were reported as infrastructure, metadata
management, workflow and collaboration, reporting, ad hoc query,
Microsoft Office integration, advanced visualization, and scorecarding.

Despite its broad functional footprint, the majority of Cognos 8
deployments are still reporting-centric. The customers surveyed for
this research reported a much lower usage of its platform for ad hoc
analysis and discovery than the average — in fact, twice the proportion
of SAP Business Objects users do some form of ad hoc analysis than IBM
Cognos customers do. To advance along the Vision axis, Cognos must
increase the number of customers using the Cognos 8 platform for ad hoc
and OLAP-style analysis. Cognos 8 PowerPlay Studio should help with
this aim.

While the increase in staff is impressive, this is somewhat
counterbalanced by the stresses and strains being placed on the Cognos
organization by the internal demands of the wider IBM organization,
which are significant and are in danger of providing a distraction from
the external market's requirements.

Given the nature of IBM's overall offering, it's inevitable that
IBM Cognos' strategy is founded on an "information versus an
applications agenda" that is not dependent on coexistence with an ERP
application stack, unlike SAP and Oracle. While this will undoubtedly
appeal to organizations that embrace heterogeneity, it may begin to
limit IBM Cognos' ability to continue to sell its BI platform into
firms with application stack-centric sourcing policies, despite its
undoubted ability to meet their needs.

Of the vendor-nominated customers surveyed for this research, the
single most frequently reported problem with Cognos 8 was "poor
performance." IBM Cognos 8 lacks robust caching, resulting in users
hitting the database each time the report is refreshed; however, the
recently announced purchase of the derivative rights to Composite
Information Server should help to resolve this problem, when integrated
(for details see "Key Observations From The Cognos Analyst Summit").

Information Builders' WebFOCUS product excels as a platform for
building custom Web-based BI applications, including RIA, often in
extranet and public Web applications where its deployments regularly
exceed tens of thousands of users executing live interactive queries
against multiple databases.

Despite BI vendor consolidation, which has relegated other
independent vendors to niche or departmental status, the majority of
Information Builders' customer references in the MQ survey consider it
as their BI standard.

Information Builders specializes in building highly parameterized
enterprise reporting for report consumers. These report consumers can
specify output formats and drill paths, in addition to measures and
dimensions, through extensive report parameterization options, while
also having an exceptional degree of report interactivity. Due to
Information Builders' report consumer-centric approach, customers that
Gartner contacted for this research rate Information Builders' software
as one of the easiest to use in the industry.

Due in part to Information Builders' mature WebFOCUS product, its
focus on internal development as opposed to acquisition, and its
continuous QA processes for all supported platforms, customer
references rate Information Builders' product quality among the best in
the industry.

Information Builders continues to be a BI innovator, having taken
early bets on integrated search, mobile, use of RIA and mashups,
predictive analytics, data discovery, and visualization (through its
OEM relationship with Advizor). However, these early bets have not yet
significantly expanded Information Builders' sweetspot beyond
enterprise reporting.

While delivery of analytic applications to report consumers is well
served by the Information Builders platform, it was late to the game
with self-service, ad hoc query/analysis tools and offers limited OLAP
capabilities. This forces a multivendor strategy among Information
Builders' customers that requires enterprise parameterized reporting
and either self-service, ad hoc query and analysis or OLAP. To address
the gap in ad hoc query and analysis, in 2008, Information Builders
introduced a promising new product, InfoAssist, a single interface for
ad hoc query, reporting and cube browsing. But the product is new and,
as yet, largely unproven. OLAP continues to be a gap in the Information
Builders platform.

Information Builders is expanding its channel efforts through a
newly established Partner Program (in 2007) and a reorganization of the
channel organization, which came under new management in 2008. While
this effort is positive and has resulted in Information Builders'
high-profile OEM relationship with IBM to deploy DB2 Web Query
(WebFOCUS Starter version) on System I, which opened new opportunities
for Information Builders with thousands of small to midsize customers,
the company's ability to generate revenue through channels still lags
behind other leading BI platform vendors.

While Information Builders has grown its international presence
since last year, the company continues to have approximately twice as
many North American direct sales reps than it does a combination of
international direct sales reps and exclusive agents.

As Information Builders derives a large percentage of its revenue
from the financial services industry, its financial performance is
likely to be negatively affected by the current economic crisis, which
may make it more difficult to keep up with the direct sales, channel
and R&D investments of the megavendors.

Since many of Information Builders' customers use custom extranet
BI applications built with WebFOCUS without knowing they are using
Information Builders, expanding brand awareness is an ongoing BI
challenge.

Microsoft joined the BI market relatively late with a broadly
capable product set at a low price point. Since then it has
consistently developed its offering, edging into the Leaders quadrant
in last year's BI Platforms Magic Quadrant.

Microsoft's pricing and packaging of its BI platform make it an
attractive proposition for organizations new to BI or firms that are
looking to reduce their portfolio of BI tools and lower their annual
software maintenance bills.

Growing market penetration — almost a third of the reference
customers Microsoft nominated to take part in the research for this
report had bought its BI platform in the last year, corroborating
earlier analysis finding a strong intent to purchase for Microsoft in
this market (see "Business Intelligence Platform Usage and Quality
Dynamics, 2008").

Strong leverage of installed base of products. By placing Excel,
SQL Server and the very rapidly spreading SharePoint Server at the
center its BI strategy, Microsoft virtually guarantees its BI
offering's continued adoption.

Microsoft's BI platform appeals to the large community of Microsoft
application developers — its development tools were rated the best of
any vendor in the market by the customers surveyed.

While Microsoft is still on track to continue to grow its market
share, the company has not executed well on communicating product road
maps and delivering on several of its BI-related product acquisitions
(such as Fast, Stratature and ProClarity).

In comparison with its large competitors, its product vision
remains somewhat limited — focused predominantly on reporting and Excel
analyst-driven BI and, more recently, some strategic BI (via
Performance Point Server).

Microsoft is lacking the operational BI vision of Oracle and SAP,
which will push BI more into business processes and closer to the point
of decision.

Long development cycles slow Microsoft's ability to deliver on
innovation, with newly announced BI product capabilities (such as
project Gemini, Microsoft's much-hyped in-memory, column-oriented
processing addition) dependent on a future Microsoft Office release
that may be as far away as 2010.

Microsoft's customers that contacted Gartner as part of his
research rated its BI metadata management as considerably poorer than
the market overall. This comes as no surprise as there is no single,
enterprise business metadata layer or capability across Microsoft's BI
platform components; each has its own metadata model, which could
damage the perception of Microsoft BI as having a low TCO.

Lack of direct sales channel. Microsoft has invested in a developer
channel program and has made new investments targeted at meeting the
needs of large enterprise accounts; however, its lack of a direct sales
channel will make it less competitive against the direct channels of
its competition and slow its market penetration. For additional
details, see "SWOT: Microsoft, Business Intelligence Platforms,
Worldwide."

MicroStrategy specializes in enterprise BI deployments running on
top of large enterprise data warehouses — its customers reported the
highest mean data volume of any vendor surveyed, coupled with a level
of satisfaction with technical performance only surpassed by vendors
using much smaller datasets.

Parameterized reporting for the report consumer is a MicroStrategy
sweetspot. It offers an object-oriented report development environment
with an extensive library of prebuilt objects, including metrics,
prompts, filters and statistical functions for creating reports with
high degrees of formatting and analytic sophistication.

Without the demands of growth through acquisition, MicroStrategy
offers a well integrated BI platform with a common metadata layer and
infrastructure, and a unified user experience. Since MicroStrategy is
not bogged down by the integration challenges, overhead and complex
operating environment of the megavendors, it has a window of
opportunity to forge ahead with innovation.

Strong BI metadata management (rated highest in the customer
survey). MicroStrategy offers a powerful metadata modeling tool to
create the semantic layer for all the components in the BI platform. As
a result, report drilling and mapping to metadata is very flexible,
allowing end users to drill down, drill up and drill across in any
attribute of the metadata.

MicroStrategy recognized that its strict licensing, contracting and
rated CPU pricing practices caused customer dissatisfaction and earned
it a reputation for being expensive and difficult. It is now offering
unrated CPU pricing as a primary pricing option. In the past, while
unrated CPU pricing was available, it was rarely offered, as customers
could only get deep discounts by selecting rated CPU pricing.

While the MicroStrategy development environment is robust and
flexible, there is a steep learning curve, even for seasoned report
developers. Outside of parameterized reports that simulate ad hoc
analysis for an end user, self-service ad hoc reporting and dashboard
creation have not been well supported to date, although enhancements
are planned for MicroStrategy 9.

In a market where megavendors are offering end-to-end BI, CPM,
packaged analytic applications and integration middleware optimized for
their specific enterprise applications and technology stacks,
MicroStrategy's focus on BI platforms may increasingly exclude it from
consideration, particularly in enterprise BI standardization projects
that seek to leverage the existing information infrastructure.

MicroStrategy's SQL generation mechanism is optimized for queries
against a data warehouse, and without federated query support (an
enhancement scheduled for MicroStrategy 9), it is not as well suited
for operational reporting off of transaction systems as other vendors.

MicroStrategy's high-end "BI vendor of last resort" opportunity
space, which allowed it to command premium pricing and enforce
restrictive contracting in the past, is narrowing as commoditization
puts downward pressure on pricing and as other vendors more tightly
integrate, enhance functionality and leverage new technologies (such as
in memory and appliances) to match MicroStrategy's large data
performance.

While MicroStrategy has added OEM relationships and developed
partnerships to deliver industry-specific solutions leveraging its
solid product vision, its geographic presence and packaged analytic
applications continue to be more limited than other leading BI
platforms.

The availability of more than 70 functional and industry-specific
packaged BI applications built on the Oracle BI Enterprise Edition
Platform attests to Oracle's understanding of how to leverage the
market interest in domain-specific and prepackaged solutions as a
growth driver for its platform.

Oracle's vision of its BI platform as the enabling technology for enterprise performance management.

Improvements in the integration of security and administration
capabilities will benefit the large installed base of customers using
Oracle applications, middleware and database technologies.

Oracle has a well established direct sales force selling the OBIEE
offering, coupled with a large number of system integrators and
value-added resellers (VARs) incorporating OBIEE into their offerings.

Rapid sales momentum into Oracle's installed base is evident from
inquiries with Gartner analysts from Oracle eBusiness Suite customers
and middleware customers considering using OBIEE in conjunction with
these applications.

Innovation. A lot of effort has been put into product integration
with other Oracle products and technologies. This will benefit the
Oracle installed base of customers. However, Oracle has been lagging
behind the competition in introducing emerging technologies, including
in-memory processing, interactive visualization and search, as part of
the BI platform offering.

Customer support and experience is rated among the lowest, as
indicated by Gartner's customer survey data. Customer success with
Oracle BI's metadata model is key to the success of the platform, and
it does not seem that customers are getting the right level of training
or support needed to be successful.

Although Oracle BI Publisher is regarded as a feature-rich product,
reporting product capabilities were indicated as a weakness in the MQ
customer reference survey.

The core strength of Panorama's NovaView solution, using
Multidimensional Expressions (MDX) to deliver a front end that runs
natively and simultaneously on SAP NetWeaver BI, Microsoft Analysis
Services and Oracle Hyperion Essbase, is compelling to the segments of
the market that have adopted these OLAP databases.

In 2008, Panorama innovated by adopting new channels to market as
part of a strategy to outflank the megavendors (which have encroached
increasingly into its core market), increasing its completeness of
vision. These new channels include: the embedding of Panorama
technology in Google Apps; a SaaS version of NovaView offered with a
unique on-premises/SaaS hybrid; and the launch of an "OLAP as a service
cloud computing platform." Its relationship with Google is noteworthy —
Panorama is working with the Google enterprise sales team to jointly
promote the Panorama solution as an enterprise, SaaS-based BI solution
embedded in Google Apps.

Organizations using Microsoft's SQL Server Analysis Services are
now looking to use Microsoft's own OLAP front ends before considering
NovaView, shrinking its addressable market — however, Panorama reports
that it has experienced a renaissance in Microsoft customers frustrated
with Performance Point's immaturity and slower pace of development.

Panorama runs natively against data sources over which it has no
control. Perhaps as a result, despite its strong caching capabilities
and efficient MDX support, almost a third of the reference customers
that Panorama put Gartner in contact with said that they had
experienced issues with poor performance (as they did the previous
year). To get the best from Panorama, organizations must first optimize
the performance of Microsoft SQL Analysis Services, SAP BW or Oracle
Hyperion Essbase sources.

Panorama deployments tend to be departmental in nature, and its
specialism in front-ending OLAP keeps it a (very effective) niche
player, rather than one that competes for broad-reach BI — Panorama's
customers state that "reporting" is where NovaView lags behind the
market as a whole, for example. (Panorama is, however, planning to
release new reporting capabilities in early 2009.)

While Panorama offers good functionality, its overall growth may be
limited as the megavendors improve their own front-end capabilities by
applying the BI technology they have acquired. As a small vendor,
Panorama must capitalize on its impressive innovation in the channel.
Panorama is expecting big things of its relationship with Google, and
it may turn out to be a major revenue earner if the forecasts are
correct, but it shouldn't risk everything on this at the expense of its
own SaaS business.

QlikTech's architecture delivers an exceptionally high degree of
customer satisfaction. The passion of QlikTech's customers was
evidenced by the number of references willing to complete the survey,
which was higher than for any other vendor, and by QlikTech garnering
the highest score when customers were asked if the vendor is viewed as
successful in the organization.

QlikTech's in-memory model, automated data integration, associative
technology and graphical analytical environment is delivering on an
underserved market for workgroup-style analytic applications that
enables business users to build solutions without much help from IT.
This application of disruptive technology to an under-met market need
is the primary reason for QlikTech's position on the Completeness of
Vision axis.

The application of QlikView toward "workgroup" analytic
applications belies its power, as its memory analytic model, 64-bit
architecture and significant customizations built for the Intel chipset
have made it the most performant BI platform in the market, based on
anecdotal feedback.

QlikTech's culture of penetrating accounts with low-cost
deployments will be a particular strength in the current economic
environment as organizations look to deliver on analytical requirements
without significant IT investment.

QlikView's 8.5 release delivered a "set analysis" capability that
improves its ability to compare slices within information sets. For
instance, set analysis would allow users to compare purchase patterns
of high-value customers with purchases of low-value customers.

QlikView is lacking the statistical and predictive modeling
capabilities of some of its most similar competitors, including SAS
JMP, Advizor and Tibco Spotfire.

The current capital market makes QlikTech's plans for an initial
public offering unlikely. Therefore, questions about whether it will be
sold, and if so, to who, generate doubt among prospects who are unsure
of the impact the acquiring company will have on QlikTech. For more
details, see "SWOT: QlikTech, Business Intelligence Platforms,
Worldwide."

Despite the incredible success and growth that QlikTech
demonstrated in 2008, the company is still in a similar position as it
was last year. For QlikTech to become a Leader, it needs to show more
examples of large BI deployments that deliver a variety of analytical
capabilities to thousands of users.

Currently, QlikView's architecture does not lend itself well to
enterprisewide deployment, as it lacks an enterprise metadata
management layer that describes external data sources.

According to the customers taking part in the Magic Quadrant
survey, SAP Business Objects supports among the largest data and
deployment volumes and is considered to be an organization's BI
platform standard more often than any other vendor.

SAP Business Objects' reporting and ad hoc query capabilities
continue to be cited as its top strengths by its customers, while for
NetWeaver BI, OLAP is cited as its most capable area, reflecting the
complementary nature of the product sets it is bringing together.

The firm has a large channel and services "ecosystem" in 127
countries with 5,250 channel partners, 1,350 VARs globally and 850 OEMs.

SAP is continuing Business Objects' established strategy of
providing leading-edge capabilities in the areas of text analytics,
OnDemand BI (SaaS), search coupled with BI, metadata, data lineage and
impact analysis, and data quality.

The SAP BI Accelerator is bringing much needed performance
improvements to the SAP installed base of NetWeaver BI/BW customers —
poor performance was cited as a problem by a third of these customers,
significantly more than for any other BI platform.

Customer support is among the lowest levels of satisfaction, as
indicated in our customer surveys. Client inquiries from the SAP
installed base indicate concern and resistance to negotiating/funding
the additional product, support and migration costs associated with
SAP's new BI platform product road map and strategy.

SAP's acquisition of Business Objects forces its SAP NetWeaver BI
customers, who have implemented the BEx BI tools, to re-examine their
BI strategy. These companies must determine what role NetWeaver BI will
play as a data warehouse and a BI platform. Inquiries from new and
installed-base SAP customers indicate that the implementation choices
can be confusing and complex, and that there is no easy option for
integration, migration or upgrades between one alternative or the
other. As of 4Q08, architectural guidance (in the form of
configuration, architectural or product guides) from SAP on which
implementation option to use is not available to SAP customers and the
sales channel.

Product capabilities. The customers surveyed for this Magic
Quadrant gave SAP Business Objects' OLAP capabilities a low rating and,
although seen as its main strength, NetWeaver BI's OLAP functionality
lagged behind the rating of its main competitors. A new OLAP product
which will replace BEx Analyzer and Business Objects Voyager is being
defined according to the SAP/Business Objects product road map.

While most other BI vendors in the Magic Quadrant focus on
historical analysis, SAS's approach to BI originates with forecasting,
predictive modeling and optimization, and embedding them within
cross-functional and industry-specific applications. The survey data
collected shows clearly that SAS is the only BI vendor of any scale
whose customers use data mining or predictive modeling extensively.

Even though SAS derives a large percentage of its revenue from the
financial services industry, its focus on optimization solutions may
put it in a better position than traditional BI platform vendors to
weather the current economic crisis.

SAS derives an increasing percentage of its revenue and growth from
packaged analytic applications built on its BI platform that
incorporate advanced analytics into cross-functional and industry
applications around specific business problems, such as risk
management, warranty analysis or anti money laundering. This strategy
leverages SAS's core advanced analytics strength to build pull-through
revenue for its less well known BI platform, while providing insulation
from pricing pressure in the BI platform tools market.

In an effort to expand its appeal beyond the traditional SAS power
user to business analysts, SAS has made investments in data discovery
and visualization by integrating JMP, an in-memory analytics offering
with data discovery and visualization capabilities, with the BI
platform. SAS's recent acquisition of Teragram will not only serve to
enhance its position by adding natural language processing and advanced
linguistic technology to its text mining offering, but it will also
enable SAS to add enterprise and mobile search to its BI offerings.

SAS is leveraging its well known global brand for predictive
analytics with a sales and support structure in all major geographies
to build momentum and pull-through revenue for its BI platform.

Although SAS has made progress in providing tools for users beyond
its traditional user base, it has justifiably not yet overcome its
reputation for being more difficult to use. While SAS offers Web Report
Studio, a business user interface, anything beyond simple ad hoc
reporting requires the power user-oriented Enterprise Guide, with many
of the data manipulation and advanced analysis tasks requiring SAS
programming language knowledge. The need for specialized skills
represents a significant barrier to adoption in new SAS accounts.

Despite SAS's success and brand awareness as a leading advanced
analytics vendor, the company continues to struggle to make it onto BI
platform shortlists, due to perceptions around limitations in usability
and functionality, even in SAS installed-base accounts and despite
hundreds of deployments of SAS's BI Server. The majority of SAS
customers surveyed for this year's MQ do not consider SAS their
enterprise BI standard.

SAS provides broad BI platform capabilities, with particularly
strong office integration, according to the survey respondents, but
still lacks true Web-authored pixel-perfect reporting (beyond the
current programmatic capability). Further, although the SAS BI platform
components share a common infrastructure and enterprise metadata model,
workflow between some components in the platform is not yet seamless.
For example, SAS Dashboards do not support drill through, even against
OLAP data sources. At the same time, users cannot embed content in SAS
Dashboards created in other SAS tools, such as Enterprise Guide, Web
Report Studio or OLAP Viewer; users can only access this content in a
dashboard through links.

SAS always had a strong Completeness of Vision because of 1)
geography, 2) vertical support and 3) breadth of product for analysis,
but it still lacks the vision on the importance of the stack. There are
two clusters of BI platform vendors: the megavendors that want to own
the stack, and the independent vendors that must fit into a
heterogeneous stack. MicroStrategy, Information Builders and Tibco
Spotfire understand the heterogeneous stack requirement. They are
focused on integrating with other portals and enabling application
mashups. While SAS's broad standards support and its program for
in-database mining and processing outside of SAS storage (data sets)
with Teradata represent a step toward a more open architecture, the
company is still something of an analytic island with few published
application programming interfaces (APIs); it has not yet fully
embraced the vision of a heterogeneous BI platform.

While SAS's subscription-based pricing model is a concern for
buyers that require perpetual use rights, in the current economic
downturn, the ability to treat SAS software as an operating expense
versus a capital expenditure may mitigate some of SAS's potential
revenue risk.

Spotfire has a unique architecture that combines in-memory
analytics and interactive visualization for a flexible and easy-to-use
environment for building and consuming analytic applications. This
architecture has been particularly attractive delivering on
requirements for personal and workgroup applications.

The Insightful acquisition gives Tibco Spotfire a set of predictive
capabilities including a data mining workbench (Insightful Miner) and
the S+ language for rapid prototyping of statistical analysis and
what-if modeling.

In Tibco Spotfire 2.1 (released in May 2008), the Web player
provides a Web mashup API. We believe this style of "course grained
mashup" will be very useful for integrating analytics into enterprise
applications.

Based on the customer reference survey, Tibco Spotfire scored
relatively low on the use and data volume questions, compared with
other vendors' reference customers. This supports anecdotal evidence
that Spotfire is not used by a large number of users in most of its
deployments, nor is it used to analyze particularly large data sets.

Tibco Spotfire also scored the lowest in the reference survey on
the BI platform standardization question. This supports anecdotal
evidence that Spotfire is rarely seen as the enterprise standard BI
platform. Spotfire is usually positioned as an augmentation to a BI
standard to provide more flexible discovery-based analysis.

Magic Quadrant customer references also list selected metadata
management as the primary weakness of the product. References could
pick from a list of the 12 capabilities Gartner uses to define a BI
platform in this document. This choice by the customers is consistent
with Spotfire's strategy of providing a flexible analysis environment
where pre-modeling of data and interfaces are not necessary

At the time of the customer interviews in 4Q08, Tibco Spotfire
still lacks a significant number of references on two of its major
product improvements in 2008 — operations analytics and the mashup API.

The
Magic Quadrant is copyrighted 16 January 2009 by Gartner, Inc. and is
reused with permission. The Magic Quadrant is a graphical
representation of a marketplace at and for a specific time period. It
depicts Gartner's analysis of how certain vendors measure against
criteria for that marketplace, as defined by Gartner. Gartner does not
endorse any vendor, product or service depicted in the Magic Quadrant,
and does not advise technology users to select only those vendors
placed in the "Leaders" quadrant. The Magic Quadrant is intended solely
as a research tool, and is not meant to be a specific guide to action.
Gartner disclaims all warranties, express or implied, with respect to
this research, including any warranties of merchantability or fitness
for a particular purpose.